The precipitous growth of institutional ownership has changed the makeup of corporate equity ownership and trading activity. Institutions are the also the largest lenders in the equity lending market. Using quasi-experimental methods within a precautionary savings framework, we show that companies save more cash and repurchase more stocks when more stocks are available for shorting.A one-interquartile range (IQR) increase in lendable supply is associated with a 1.3% increase in cash holdings in the subsequent quarter, equivalent to 5.9% of the IQR variation observed for cash holding.